Electric vehicle charging companies have begun to battle it out for prime locations for fast public chargers in both Europe and the US. Industry observers anticipate additional rounds of consolidation as major investors join the war.
Long-term investors support a large number of the EV charger startups already operating, and more are anticipated. Infrastructure investors like M&G's Infracapital and Sweden's EQT are becoming more interested in the sector as a result of impending prohibitions on fossil fuel-powered automobiles in several nations.
"If you look at our customers, it's like a land grabbing game now," Tomi Ristimaki, CEO of Finnish EV charger manufacturer Kempower (KEMPOWR.HE) said. "Who gets the best locations now can guarantee electricity sales in the coming years."
Analysis revealed that there are over 900 EV charging businesses worldwide. According to PitchBook, the industry has drawn over $12 billion in venture capital funding since 2012.
"The fast-charging landscape will look pretty different from the landscape that exists today," said Michael Hughes, chief revenue and commercial officer of ChargePoint, one of the biggest providers of EV charging hardware and software, as huge investors support greater consolidation.
Companies that have made significant investments in the sector—which has witnessed 85 acquisitions since 2017—range from Volkswagen to BP and E.ON.
In the UK alone, there are over thirty operators of rapid chargers. Two new ones were introduced last month: Zapgo, which has raised $31.4 million from Canadian pension fund OPTrust, and Australia's Jolt, which is supported by BlackRock's infrastructure fund.
According to Loren McDonald, CEO of San Francisco-based research firm EVAdoption, Tesla is the largest participant in the US market, but additional convenience stores and gas stations will soon enter the fray. Additionally, the number of fast-charging networks in the US will more than double to 54 in 2030 from 25 in 2022.
Once utilisation reaches about 15%, it can take four years for an EV charging station that is situated properly to turn a profit. Charger companies claim that European bureaucracy is impeding their growth.
However, long-term infrastructure investors such as Infracapital, which owns Recharge in Norway and has invested in Gridserve in Britain, see the sector as a solid gamble.
"With the right locations, long-term investments in (charging companies) absolutely make sense," said Christophe Bordes, managing director at Infracapital.
According to Hughes of ChargePoint, larger players will start searching for new real estate that is specifically designed for mega-facilities with 20 or 30 fast-charge dispensers surrounded by shops and amenities, rather than just using the locations that now exist.
"There's a race for space," he said, "but it will take longer than anybody expects to find, build and enable these new sites for the next generation of fast charging."
The competition is getting more and more intense for the top sites, and site hosts have the option to move between operators before choosing a winner.
"We like to say there's no such thing as a dead deal when you're talking to a site host," Blink Charging CEO Brendan Jones said.
Additionally, businesses are vying for exclusivity agreements with hosts.
For example, EQT-owned InstaVolt in the UK has agreements with businesses such as McDonald's to install charging stations at their sites.
Adrian Keen, CEO of InstaVolt, stated, "If you can win that partnership, it's yours until you blow it."
With EQT's "deeper pockets," InstaVolt has started operations in Spain and Portugal, expects to install 10,000 chargers in the UK by 2030, and now has chargers operating in Iceland. Keen said. He said that consolidation might begin in the upcoming year or so.
"That might open up opportunities in the markets we're in, but also open the door to a new market for us," Keen said.
3,500 EV charging stations, or around 20% of the German market, are owned by Utility EnBW's charging unit. To reach 30,000 charging stations by 2030, it plans to invest 200 million euros ($215 million) a year and rely on local employees to stave off competition for locations.
According to vice president of sales Lars Walch, the division has also established charging network agreements in Austria, the Czech Republic, and northern Italy.
There will still be room for multiple operators even with the impending consolidation, according to Walch.
According to Recharge CEO Hakon Vist, Norway, a prominent EV market, has suffered from short-term "over-deployment" this year as businesses rushed to install charging stations. Although there are now 7,200 charge stations on the market, EV sales were down 2.7% in October of this year.
In Norway, Recharge is somewhat behind Tesla in market share at about 20%.
"Some companies will find they're too small to meet customers' requirements and leave or sell," Vist said.
Some are starting businesses with the knowledge that they might buy others out or be bought themselves.
Targeting underserved areas in the Southwest of England, Zapgo, a recent UK entry, is sponsored by OPTrust and will provide landlords a portion of their charging income in exchange for prime placements. According to CEO Steve Leighton, consolidation "will all come down to money" later this decade. The company expects to have 4,000 chargers by 2030.
"The funders who've got the deepest pockets will be running that consolidation," Leighton said, adding OPTrust "is big, but one of the larger infrastructure funds might come along and want to pick Zapgo up at some point."
According to McDonald of EVAdoption, the U.S. industry will change when major retailers like Walmart and convenience store brands like Circle K and Pilot Company make significant investments in charging stations.
"Like all industries started by a bunch of small startups, over time the big guys jump in and ... they consolidate," McDonald said. "At the end of this decade, the logos are going to be very different."
(Source:www.theprint.in)
Long-term investors support a large number of the EV charger startups already operating, and more are anticipated. Infrastructure investors like M&G's Infracapital and Sweden's EQT are becoming more interested in the sector as a result of impending prohibitions on fossil fuel-powered automobiles in several nations.
"If you look at our customers, it's like a land grabbing game now," Tomi Ristimaki, CEO of Finnish EV charger manufacturer Kempower (KEMPOWR.HE) said. "Who gets the best locations now can guarantee electricity sales in the coming years."
Analysis revealed that there are over 900 EV charging businesses worldwide. According to PitchBook, the industry has drawn over $12 billion in venture capital funding since 2012.
"The fast-charging landscape will look pretty different from the landscape that exists today," said Michael Hughes, chief revenue and commercial officer of ChargePoint, one of the biggest providers of EV charging hardware and software, as huge investors support greater consolidation.
Companies that have made significant investments in the sector—which has witnessed 85 acquisitions since 2017—range from Volkswagen to BP and E.ON.
In the UK alone, there are over thirty operators of rapid chargers. Two new ones were introduced last month: Zapgo, which has raised $31.4 million from Canadian pension fund OPTrust, and Australia's Jolt, which is supported by BlackRock's infrastructure fund.
According to Loren McDonald, CEO of San Francisco-based research firm EVAdoption, Tesla is the largest participant in the US market, but additional convenience stores and gas stations will soon enter the fray. Additionally, the number of fast-charging networks in the US will more than double to 54 in 2030 from 25 in 2022.
Once utilisation reaches about 15%, it can take four years for an EV charging station that is situated properly to turn a profit. Charger companies claim that European bureaucracy is impeding their growth.
However, long-term infrastructure investors such as Infracapital, which owns Recharge in Norway and has invested in Gridserve in Britain, see the sector as a solid gamble.
"With the right locations, long-term investments in (charging companies) absolutely make sense," said Christophe Bordes, managing director at Infracapital.
According to Hughes of ChargePoint, larger players will start searching for new real estate that is specifically designed for mega-facilities with 20 or 30 fast-charge dispensers surrounded by shops and amenities, rather than just using the locations that now exist.
"There's a race for space," he said, "but it will take longer than anybody expects to find, build and enable these new sites for the next generation of fast charging."
The competition is getting more and more intense for the top sites, and site hosts have the option to move between operators before choosing a winner.
"We like to say there's no such thing as a dead deal when you're talking to a site host," Blink Charging CEO Brendan Jones said.
Additionally, businesses are vying for exclusivity agreements with hosts.
For example, EQT-owned InstaVolt in the UK has agreements with businesses such as McDonald's to install charging stations at their sites.
Adrian Keen, CEO of InstaVolt, stated, "If you can win that partnership, it's yours until you blow it."
With EQT's "deeper pockets," InstaVolt has started operations in Spain and Portugal, expects to install 10,000 chargers in the UK by 2030, and now has chargers operating in Iceland. Keen said. He said that consolidation might begin in the upcoming year or so.
"That might open up opportunities in the markets we're in, but also open the door to a new market for us," Keen said.
3,500 EV charging stations, or around 20% of the German market, are owned by Utility EnBW's charging unit. To reach 30,000 charging stations by 2030, it plans to invest 200 million euros ($215 million) a year and rely on local employees to stave off competition for locations.
According to vice president of sales Lars Walch, the division has also established charging network agreements in Austria, the Czech Republic, and northern Italy.
There will still be room for multiple operators even with the impending consolidation, according to Walch.
According to Recharge CEO Hakon Vist, Norway, a prominent EV market, has suffered from short-term "over-deployment" this year as businesses rushed to install charging stations. Although there are now 7,200 charge stations on the market, EV sales were down 2.7% in October of this year.
In Norway, Recharge is somewhat behind Tesla in market share at about 20%.
"Some companies will find they're too small to meet customers' requirements and leave or sell," Vist said.
Some are starting businesses with the knowledge that they might buy others out or be bought themselves.
Targeting underserved areas in the Southwest of England, Zapgo, a recent UK entry, is sponsored by OPTrust and will provide landlords a portion of their charging income in exchange for prime placements. According to CEO Steve Leighton, consolidation "will all come down to money" later this decade. The company expects to have 4,000 chargers by 2030.
"The funders who've got the deepest pockets will be running that consolidation," Leighton said, adding OPTrust "is big, but one of the larger infrastructure funds might come along and want to pick Zapgo up at some point."
According to McDonald of EVAdoption, the U.S. industry will change when major retailers like Walmart and convenience store brands like Circle K and Pilot Company make significant investments in charging stations.
"Like all industries started by a bunch of small startups, over time the big guys jump in and ... they consolidate," McDonald said. "At the end of this decade, the logos are going to be very different."
(Source:www.theprint.in)
